Hong Kong Shares Edge Lower; Tech, Home Appliance Stocks Weigh
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Nov 28 2024
0mins
Should l Buy LI?
Source: WSJ
Hong Kong Market Update: Hong Kong shares are slightly down, influenced by declines in home appliance and tech stocks, with investors awaiting signals from the upcoming Politburo meeting regarding potential economic stimulus. The Hang Seng Index is down 0.1%, while notable declines include Tencent and Haier Smart Home.
Japanese Market Update: Japanese stocks are also lower due to drops in auto and electronics sectors amid uncertainty over U.S. trade policy, with the Nikkei Stock Average down 0.6%. Investors are monitoring global developments, particularly in Ukraine and the Middle East.
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Analyst Views on LI
Wall Street analysts forecast LI stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for LI is 21.12 USD with a low forecast of 17.00 USD and a high forecast of 32.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
11 Analyst Rating
2 Buy
8 Hold
1 Sell
Hold
Current: 18.970
Low
17.00
Averages
21.12
High
32.00
Current: 18.970
Low
17.00
Averages
21.12
High
32.00
About LI
Li Auto Inc is a holding company primarily engaged in the design, development, manufacturing, and sales of smart electric vehicles. The Company’s main products include the Li L9, Li L8, Li L7, Li L6, and Li MEGA, encompassing six-seat sport utility vehicles (SUVs), five-seat SUVs, and multi-purpose vehicles (MPVs). The Company is also engaged in research and development activities relating to intelligent vehicle technologies, the design, development and manufacturing of various components and systems for new energy vehicles, and the provision of value-added services such as charging, vehicle maintenance and repair. The Company mainly conducts its businesses within domestic market.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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See More
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- Software Issue Impact: The recall affects vehicles manufactured between March 16, 2018, and January 16, 2023, with the software problem potentially causing brief blackouts of the instrument cluster and central control screen; Nio plans to address this through remote software updates and service center upgrades, demonstrating its commitment to customer safety.
- Positive Profit Outlook: Despite the recall, Nio expects an adjusted operational profit of approximately 700 million to 1.2 billion yuan (around $100 million to $172 million) for Q4 2025, contrasting sharply with a 5.54 billion yuan loss in Q4 2024, indicating potential recovery for the company.
- Significant Delivery Growth: In January, Nio reported a 96.1% year-over-year increase in deliveries, reaching 27,182 vehicles, with the third-generation ES8 SUV accounting for nearly two-thirds of total deliveries, highlighting the company's ongoing investment in smart EV technologies and its competitive market position.
See More
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- Sales Downgrade: J.P. Morgan downgraded Li Auto (LI) from Neutral to Underperform, forecasting a 10% sales drop in 2026 due to a lack of new models and overlapping products from competitors.
- Increased Price Pressure: To counter competition, Li Auto is offering rebates of RMB 20-30K, but this could erode the company's fragile profitability and lead to further declines in share price.
- Rising Industry Costs: J.P. Morgan anticipates that rising spot prices for lithium, copper, and storage chips, which have surged by 30% to 50%, will exert widespread pressure on EV industry profits, affecting earnings estimates for Li Auto and other OEMs.
- Negative Market Reaction: The downgrade of Li Auto has resulted in a 3% drop in its share price on Monday, reflecting investor concerns about the company's future profitability and potential impact on its competitive position.
See More
The Rise and Transformation of Physical AI
- Physical AI Transformation: Bank of America analyst Martyn Briggs highlights that the rise of Physical AI is underway, projected to drive a trillion-dollar market shift as value transitions from digital models to physical machines like robots, autonomous vehicles, and drones, marking a significant shift of intelligence from screens to machines.
- Humanoid Robot Production: Over 50 companies are developing humanoid robot platforms, with shipments expected to grow from tens of thousands today to millions annually over the next decade, driven by labor shortages and falling component costs, which will transform operations in manufacturing and logistics.
- Autonomous Driving Adoption: Robotaxis are operational in multiple cities, and advanced driver-assistance systems are set to achieve mass adoption in China by 2030, with hardware cost reductions significantly lowering ride-hailing and freight costs, thus transforming mobility into a software-defined, AI-driven platform.
- Investment Opportunities: Bank of America has highlighted 15 publicly traded companies exposed to Physical AI, including Nvidia, Tesla, and Qualcomm, which are leading in chips, robotics, mobility, and sensing, expected to spearhead this transformative wave.
See More
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- Positive Profit Outlook: Nio anticipates an adjusted profit from operations of approximately 700 million to 1.2 billion Chinese yuan (about $100 million to $172 million) for Q4 2025, a stark contrast to the 5.54 billion yuan loss in Q4 2024, indicating a strong potential for business recovery.
- Significant Delivery Growth: In January, Nio reported a 96.1% year-over-year increase in deliveries, reaching 27,182 vehicles, with the third-generation ES8 SUV accounting for nearly two-thirds of total deliveries, highlighting the company's ongoing growth and market share expansion in the EV sector.
- Ongoing Technology Investment: Nio continues to invest heavily in smart EV technologies, planning to launch an upgraded NIO World model in January 2026 to enhance assisted driving, smart parking, and safety features, further improving user experience and competitive positioning.
- Stock Price Surge: Following the positive profit alert, Nio's stock rose 9.23% to $4.84 in premarket trading on Thursday, reflecting market optimism regarding the company's future profitability.
See More
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- Sales Decline: BYD reported only 83,249 battery electric passenger cars sold in January, marking a significant drop and indicating weak domestic demand while facing fierce competition, which could impact its market share.
- Policy Impact: The reinstatement of a 5% purchase tax on new energy vehicles starting January 1 ends over a decade of exemptions, likely further suppressing consumer purchasing intentions and affecting overall sales.
- Intensifying Competition: Brands like Xiaomi and Nio reported year-on-year delivery increases in January, with Xiaomi exceeding 39,000 deliveries, highlighting intensified market competition that may pressure BYD's sales.
- Export Decline: BYD's exports fell to 100,482 vehicles in January from 133,172 in December, reflecting weakening international demand, which could adversely affect the company's overall performance.
See More
Li Auto Reports Continued Decline in Deliveries
- Declining Deliveries: Li Auto delivered 27,668 vehicles in January 2026, reflecting a 7.55% year-over-year decline, marking the eighth consecutive month of falling deliveries and reaching the lowest level since March 2025, indicating the impact of intensified competition on its L-series hybrids.
- Cumulative Delivery Figures: The cumulative delivery total now stands at 1,567,883 units, showcasing the company's ongoing efforts in the market, but the recent decline in deliveries may adversely affect its future market share and brand perception.
- Retail and Charging Network: As of January 31, 2026, Li Auto operates 547 retail stores and 547 service centers across 159 cities, along with 3,966 supercharging stations nationwide, equipped with 21,945 charging stalls, demonstrating its continued investment in infrastructure development.
- Poor Financial Performance: In November 2025, Li Auto reported a significant decline in third-quarter fiscal results, with vehicle sales dropping 37.4% to $3.6 billion, primarily due to lower delivery volumes and rising costs, which could negatively impact its future profitability.
See More
